Meeting with delegation from the Zimbabwean Parliament

10 November 2009

Chairperson: Mr M Sogoni (ANC)

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Meeting Summary

The Committee hosted a delegation from the Zimbabwean Parliament, composed of members of the committees on Budget, Finance and Investment Promotion and Public Accounts. The Chairperson briefed the delegation on the Committee’s new functions and duties under the newly enacted Money Bills Amendment Procedure and Related Matters Act. In return, the Zimbabwean delegation explained their progress in developing Zimbabwe's Public Finance Management Bill and the establishment of the Zimbabwean Parliamentary Budget Office. It was envisaged that the Budget Office would provide technical support to Parliamentarians and co-ordinate the participation of business, civil society and other stakeholders in the process of developing the budget.
The Committees also discussed the process for considering Quarterly Expenditure Reports and the how the separation of powers would be achieved with the advent of the respective Parliamentary Budget Offices.

The Committee was due to consider the First Quarter Expenditure Report for adoption but decided to defer this business to the following week, as a result of already stretched schedules.

Meeting report

Interaction with delegation from the Zimbabwean Parliament
The Committee hosted a delegation from the Parliament of Zimbabwe, specifically members of the Committees on Budget, Finance and Investment Promotion and Public Accounts. The Chairperson introduced the members of the Committee

The Hon Paddy Zhanda, the Chairperson of the Budget, Finance & Investment Promotion Committee of the Zimbabwean Parliament introduced his delegation. The Chairperson explained that the Committee was formed according to the provisions of the Money Bills Amendment Procedure and Related Matters Act (the Act). The Act also established the Standing Committee on Finance, which dealt with the macroeconomic matters and the elements that determined the Fiscal Framework.
Previously, the Committee had been called the Joint Budget Committee (JBC). This had been a joint committee and was composed of members from both the National Assembly and National Council of Provinces. The new Standing Committee on Appropriations dealt mainly with spending matters, particularly the Division of Revenue Bill. This divided the national revenue into allocations to national, provincial and local government.
The Appropriations Bill dealt with national departments and the later Adjustment Appropriation Bill made additional allocations to certain departments and entities in the middle of the financial year. The latter would be debated that afternoon.
The Committee monitored expenditure by looking at Quarterly Reports of national departments and this was on the agenda at present. The Public Finance Management Act stipulated that departments had to submit monthly and quarterly reports to Parliament. As Parliament did not have sufficient time to deal with monthly report, they used the quarterly reports to monitor departmental expenditure.

Mr Zhanda reported that the purpose of their visit was a fact-finding mission to observe co-ordination in Parliaments in the region. They felt that accountability was important, particularly in relation to the Executive. The Parliament of Zimbabwe did not have clusters yet, but they did have joint meetings of relevant committees, such the committees on Budget, Finance and Investment Promotion and Public Accounts. In these sittings, they endeavoured to keep party politics from playing a role and this approach was working well. They did not have a committee on appropriations. Under the Standing Rules of the Zimbabwean Parliament, committees were empowered to call anyone before them, with 14 days notice. Committees also had the power to charge someone through Parliament.
The Zimbabwean Parliament was developing its own Public Finance Management Bill. It had already passed the First Reading by the Minister of Finance and had been referred to the Legal Committee to determine if the Bill conflicted with the Constitution. The Bill would then proceed to the Second Reading by the Minister and a debate in Parliament.
The Zimbabwean Parliament also planned to set up an Auditor’s Office to strengthen the authority of the Auditor-General. He stated that the Zimbabwean government was grateful to South Africa for the role it had played in Zimbabwe and hoped for continued stabilisation in Zimbabwean government.

Hon Tapiwa Mashakada, Chairperson: Committee on Public Accounts (also an ordinary member of the Budget, Finance and Investment Promotion Committee) stated that the Budget, Finance and Investment Promotion Committee was looking at a new Macroeconomic Framework for Zimbabwe as well as a Fiscal Framework. At present, departments were not compelled to table their accounts. Once the Public Finance Management Bill became an Act, they would also consider quarterly reports and were pleased to observe this process in practice.
The Public Accounts Committee considered the Auditor-General reports on state finances and property. They were moving to consider a Budget Office. This Office would report to the committees on Public Accounts and Budget, Finance and Investment Promotion and provide technical support to the committees.
They believed that Parliament must also play an active role in harnessing the views of stakeholders and civil society as part of public participation. The Budget Office was also envisaged to co-ordinate this.

DiscussionHon Jabulani Mangena asked whether the quarterly reports were considered exclusively by the Standing Committee on Appropriations and wondered whether they were also referred to the relevant Portfolio or Standing Committee.

The Chairperson responded that this was a very interesting question and that this had not yet been resolved. At present, the established process was that the National Treasury submitted the quarterly reports to the Standing Committee on Finance. Portfolio Committees could voluntarily attend the hearings relevant to them. Parliament had not fully synchronised their systems to enable this and such a process was not included in the Rules yet, but Parliament was working towards this. They did see this as important because the Standing Committee on Appropriations received a lot of valuable information at the hearings on the quarterly reports and follow-up could be difficult.

Mr L Ramatlakane (COPE) queried the Zimbabwean Parliament’s envisaged view of the Budget Office. He asked if the Budget Office’s research capacity would reflect Parliament’s independent view of the economy. He stated that if a Parliament wanted to play a central role in budget formulation that also meant that they would have to co-own the economic assumptions and projections used to formulate a budget. He asked for the delegations views on whether this co-ownership of the budget limited the independence of Parliament in considering changes to budget and whether this might blur responsibilities and roles.

The Chairperson clarified that the South Africa Constitution created the separation of powers. The Member’s question was premised on how Parliament could both develop the budget and do oversight of that budget and how independent the Budget Office would be in this process. The Parliament Budget Office was established as independent in clause 15 of the Money Bills Amendment Procedure and Related Matters Act.

Hon Zhanda replied that they had the same set-up in Zimbabwe, as regards the independence and accountability of the Budget Office. The committees did lack capacity in expert advice and currently relied on outside people to undertake research and do consultative work. The new framework required Parliament to be involved in budget formulation and economic plans of the country. They wanted the Budget Office to be properly funded and resourced to do the critical analysis for the committees’ use. Members of the Zimbabwean Parliament were all part-time Members and it was currently up to the Secretariat to provide the necessary research work. He agreed that there should be separation of powers.

Hon Mashakada added that the whole idea behind Parliament being involved in the budget cycle was to demystify the budget. The budget was meant for the people and the committees wanted to unpack the budget and provide for public participation. This approach was aimed at proactive oversight, without usurping the powers of the Executive. Parliament also had to play a role to promote good governance.
The best practice internationally was to have pro-poor policies and in the wake of the global economic crisis, development economics was emphasised. Their interest was in creating participatory budget models. This was what they had observed about the systems in the USA, Philippines, Afghanistan and Canada. The Budget Office would be an extra hand to help parliamentarians understand what happened at Executive level.

The Chairperson replied that Parliament was on the verge of establishing the Budget Office, with the aim of Parliament being able to engage with the Budget tabled in February 2010. The Money Bills Amendment Procedure and Related Matters Act allowed Parliament to amend the current Adjustment Appropriation Bill. In 2010, once the Standing Committee on Appropriations approved the macroeconomic framework and the fiscal framework, the Portfolio Committee could begin to engage on the individual departments' budgets and strategic plans. Although the Parliament was not allowed to amend yet, they were allowed to evaluate budgets and analyse whether departments planned to spend on priority areas.

Hon Zhanda thanked the Committee for the platform to share information.

Postponement of Consideration of Committee’s Report on First Quarter Expenditure 2009/10
The Chairperson apologised for the unexpected visit by the Zimbabwean delegation. There had been a communication breakdown with the Office of the Speaker. He asked the Committee for suggestions on how to proceed, as their time was now limited. The Committee now faced the possibility of submitting the report to Parliament without having the opportunity to debate it. He had wanted to engage the Executive. The Recommendations in the Report had to be clear as they would be considered by the Deputy President and should outline what the Committee wanted to do with quarterly reports in future.

Mr Ramatlakane noted that the Report had to be finalised but was not sure that this had to be done in this meeting. He asked if it was possible to reschedule, as the Report would go onto the ATC. As the Committee did not need to debate the Report at Plenary, there was no pressure and they could have another meeting to finalise the Report.

Mr S Swart (ACDP) agreed with this proposal.

The Chairperson suggested that this would be possible in the following week, as there were no caucuses or plenaries planned. They had meetings with the National Treasury scheduled for the morning sessions but could possibly use the afternoon sessions.
Regarding the timing of reports, he stated that he had spoken to National Treasury on the late reports. The First Quarter Reports should have been done by August.

Mr Swart agreed with the proposal. He asked for the updated programme to be circulated as soon as possible.